Concession would make fuel economy standards easier for large trucks (Source: Dodge)

Concession would reduce the yearly increase rate for new standards for large trucks and SUVs to 3.5% per year

The Obama administration wants to significantly
increase the CAFE standards that govern fleet wide fuel economy for automakers.
The problem is that there is a huge amount of backlash from those in the
automotive industry. The backlash is so far keeping the Obama administration
and automakers from coming
to an agreement on proposed fuel economy standards moving into the future.

The Obama administration has put aconcessionforward
in an effort to woo the Big 3 automakers to agree to the economy standards. The
concession would see the makers of big trucks and SUVs forced to move to the
higher fuel economy standards at a much slower rate than makers of cars and
light SUVs. Hopes are high that the agreement between the Obama administration
and the Big 3 will be made by early next week.

Washington wants the CAFE requirements to beset
at 56 mpgby 2025. The concession would allow the Big 3 to adopt
the CAFE standards for the larger, gas guzzling vehicles, at a rate of 3.5% per
year rather than the 5% annual improvement rate that the Obama administration
wants for light trucks, cars, and light SUVs.

CAFE standards are currently targeting 35.5 mpg
fleet wide by 2016 and that number will grow to 56 mpg by 2025 under the
proposed regulations. The final rules are hoped to be ready by September.

However, automakers outside the Big 3 are not
happy at all about the proposed concession. Carmakers that do not produce large
SUVs and trucks see the concessions as giving the Big 3 an unfair advantage.
The companies feel that the concession would encourage consumers to buy less
efficient vehicles.

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Isn't this kind of like what made the SUV craze happen in the first place?Yes, if gas is $4 and higher there won't be so many buying SUVs when there would be cars getting over 40 mpg, but you'd think this consession would help make the SUV/truck price comparabe to the cars that have to meet the standard.And since the BIG 3 are the ones with the most big vehicles they get the benefit, but how would say Honda be hurt by this?

This is just the government giving its lobbyists a helping hand, like they always do. Obummer is just trying to give the big 3 a leg up since they're usually too pathetic to support themselves on their own without the government giving them a helping hand.

quote: It's not the Governments job to tell automakers what they can provide to the consumer. End of story.

Such a shortsighted view.

Part of the job of government is to protect the people. One way is to keep the economy functioning. If fuel prices spiral out of control and supply becomes limited because of overuse as a result of high consumption vehicles, that hurts the economy which subsequently hurts business (including car manufacturers, if gas gets too expensive, they will sell fewere cars) AND the people.

Allowing automakers to sell high fuel consumption, less efficient vehicles only benefit the automakers and oil companies, and that benefit exists so long as gas exists, is readily available, and stays cheap. If you can think of someone else allowing open fuel standards benefits (besides speculators, which are just oil companies in disguise).

However, having the automakers sell higher efficiency vehicles benefits everyone. It gives the automakers time to research alternative fuel types before petroleum becomes too expensive/scarce/economically impractical to run existing vehicles on. It gives the individual players of the economy (both business and people) time to transition to vehicles that use new fuel types without destroying businesses. It prolongs the supply of oil as well as (if we stop getting into conflicts with oil producing nations) the low cost of fuel that our entire economy is accustomed to. Oil companies will still make money, and automakers will survive longer if they have time to evolve and develop with the market. I promise you, oil companies will still make money, and they will survive as they have time to invest/develop alternative energy to keep their businesses alive and relevant. This benefits EVERYONE.

The only thing lost is winfall profits to oil companies as the cost of a scarce good skyrockets and the low cost of building a vehicle.

Securing and stabilizing the country's energy needs is and should be a job of the government to ensure that the market doesn't destroy itself.

Sure, you may want that large vehicle, but if you want to keep driving it long term and make it affordable (affordability is something that everyone, including businesses want), conservation of petroleum to keep the price low is the only way to make it happen.

If gas prices go up, people buy more efficient cars. No legislation is required. If people buy more efficient cars, automakers make more efficient cars to compete with eachother. Again, no legislation required.

Great idea, let's not prepare businesses who rely on heavy, expensive, inefficient vehicles to run operations. Let's pretend like they can all afford to replace their fleets all at once.

In addition, manufacturers can't keep up with the demand for hybrid vehicles alone because of time to market on supplies (batteries, parts, etc). If we're not prepared to handle things on the supply side, when gas prices do go up, they will take the price of efficient vehicles up with them due to the demand/limited quantities on both.

You're right, legislation isn't needed to move people to efficient vehicles. Legislation is needed to prevent chaos and keep the overall economy stable. If you can prove to me that the free market can do this on its own (history has already shown otherwise), then I'll agree with you. But as far as I know, there is not one case study for the free market preparing (to prevent market chaos) for the exhaustion of a resource that the entire economy completely depends on. If you can prove to me one case, then I'll agree. Otherwise, you can take that invisible hand (the faith that people put in it seems to me to be similar to the faith put in gods no one has ever seen or met) and slap yourself with it.

quote: Great idea, let's not prepare businesses who rely on heavy, expensive, inefficient vehicles to run operations. Let's pretend like they can all afford to replace their fleets all at once.

Markets are customer driven. If customers demand something, supply will meet the demand. When the oil crisis hit in the 1970's, automakers initially had no fuel efficient vehicles. Within a very short period of time they were making small, fuel efficient vehicles because the market demanded it. With the cost of fuel so high, the manufacturer who could make the most fuel efficient cars made the most profit. Eventually, the fuel shortage ended and gas became cheap again. Suddenly, customers demanded larger vehicles. The small efficient vehicles were still available but they no longer sold well because customers wanted something else.

We agree with you too. We have the population enslaved with debt and we now run/own the governments too and pretty much the world. The currency depreciation, I wouldn't worry about that either if I were you - it's not like you can do anything about it.

quote: Otherwise we'd all still be driving death traps without catalytic convertors that get 10mpg. But they'd also only cost $4000... You weigh the benifits and I'm sure you'll reconsider. Having a $20,000 safe car that is quiet, doesn't pollute much and gets 40mpg is far better than the $4000 alternative.

In the mid 1920s Henry Ford saw many friends lose their lives in car accidents. The 1927 Model A Ford had safety glass, an all metal body and wheels.In the mid-fifties Ford had a padded dash and, hold on, seat belts as an option but few bought them.

Perfect vehicles, no but the manufacturer did it long before the nanny state dictated contradictory single-minded regulations. That is force very high MPG & safety standards before all material development and costs allow for any profit margin, gotta stay in business too.

Your "only the government can do it" ideology is mostly misplaced. When most people are shown the reason for such products, i.e. crash footage with and without safety devices few willingly go without. Oversight on manufacturer claims, yes. Dictating the market place, really?...

BTW If you ever had the chance to go into a junkyard in the 70s-80s you would not have found many burnt Pintos but you would have found many burnt Datsuns and Toyotas. I saw them there.

Dare I play devils advocate and mildly agree with you even though it will get me rated to oblivion for the opposing view?The issue argued is that the market dictates consumer need by demand. This is true unfortunately this is not ahead of the curve. Look at how pathetic we let cafe standards remain for how many years then all of a sudden this is a hot button to ramp things up once consumers demanded it. Had this been a government concern and a very slow reasonable gradual requirement till now we might have found ourselves there.

At this point the government is pushing too hard for too much too soon too late. We should have been looking at these thins YEARS ago and seem to think we can legislate them out of thin air. I do not support the recent hard cut cafe standards and I think American standards are keeping us from getting MANY of the great vehicles perfectly good for the rest of the world, but I do believe some regulation is needed to continue the trend, just a lighter hand. People live in the now, but manufacturers take YEARS to develop. The issue is with the size of the market, and OP is right. We would probably still drive unsafe polluting cheap cars and have no choice about it because it would be manufacturer dictated.

You would hope, but I think the issue people have is that they fail at economics and their priorities are all screwed up. I mean when you have people paying $0.20, $0.30, $0.50 per kilowatt hour and you tell them straight up that if they replace this bulb here, refrigerator here or their swimming pool pump with something more efficient, that it will PAY FOR ITSELF in a years time or less and still won't do it, you know there is something wrong. Instead, they will only replace the items when it actually breaks, and not at the point when it is no longer cost effective.

It's because they aren't dumb. There's always a tradeoff of some sort whether it be inferior lighting, higher up front cost, vanishing profit once you account for the interest on the money spent, general longevity of the replacement goods, repairability of replacement goods, etc, etc.

Further, it is wasteful to throw away something that still works. There was energy, time, natural resources spent on the replacement product.

I don't know about you but I'm not paying remotely close to $0.30, let alone $0.50 per KWH. I'd buy a natural gas generator if electrical prices were so steep. In the end we need to quit thinking greedily and look at the bigger picture. Our energy needs ARE GOING UP, the only sane solution is to ramp up nuclear plant production.

Once we do that, we can gracefully transition to new products that conserve energy once they have matured into being as reliable as those they are replacing.

A wise man once said that all societal problems - fossil fuels, poverty, war, hunger, etc -- can ultimately be reduced to a problem of energy. Energy production, energy distribution, ...you name it. Ironically energy conservation also falls into that same category.

quote: but how far are you willing to let the government go, THX 1138?

This is why we vote and have discourse in this country, to determine how far we all are to let the government go in determining how we as a people should handle anything in our lives.

I'm now going to ask you the converse extreme to show you just how reasonable your question is: How far are you willing to let others freedom of choice go in affecting your life? Let's take your suggestion and go to the extreme of abolishing all penalties for murder, theft, and rape. Let's abolish money so people just trade goods, since that is another form of government control. And let's have no incentive to form a military, so that we have no protection against foreign threats. Meanwhile, let's get rid of borders altogether.

There is already government control over certain things in your life, and in many cases, it's a good thing. It prevents chaos, such as people murdering eachother, or determining boundaries of ownership. Because a completely "free market" has no incentive to solve these problems. A completely free market is only interested in profit.

quote: This is why we vote and have discourse in this country, to determine how far we all are to let the government go in determining how we as a people should handle anything in our lives.

People don't get to vote on CAFE or EPA regulations, so sorry, it's not up to the people. This is one of the drawbacks of our modern "compartmentalized" government. Much of the day to day decisions the government makes are out of our hands.

quote: How far are you willing to let others freedom of choice go in affecting your life?

I'm sorry but only a Liberal would try to make the argument that what car we drive infringes on someone's rights' and freedoms.

quote: Let's take your suggestion and go to the extreme of abolishing all penalties for murder, theft, and rape.

So wait, you are equating a free market solution to rape and murder? I'm pretty sure that is not taking "his suggestions", not even close. Nobody is "suggesting" Anarchy!

Here's a thought for you that you probably can't figure out, but what the heck I'll throw it out there for ya.

Environmentalism = National Security.

Yeah, I know that's sooooo liberal or whatever, but hey, you might figure out that clean air, clean water, energy production are all resources that we have to protect in order to keep the country from falling apart.

I know you know everything, but you probably should go reread some of history again to find out why we have those laws in the first place. This wasn't done a whim, it was done because idiots like you thought it was okay that corporations should be able to pollute water, land, and air. It turns out that wasn't such a good idea.

This discussion isn't about emissions standards, it's about efficiency standards. Which aren't the same. As far as a cars impact on the environment, hybrids and electric cars are the worst. The batteries will NOT all be recycled. More chemicals WILL end up seeping into groundwater. They cause more air pollution initially being manufactured.

No, actually it's just really retarded. The two have absolutely nothing to do with one another. In fact environmentalism is what's largely been responsible for getting us as involved with the Middle East as we are today, which has hurt our national security.

quote: This wasn't done a whim, it was done because idiots like you thought it was okay that corporations should be able to pollute water, land, and air. It turns out that wasn't such a good idea.

quote: It prevents chaos, such as people murdering eachother, or determining boundaries of ownership. Because a completely "free market" has no incentive to solve these problems.

This is dead wrong. Even without a functional government there would still be pressure to stop criminals. The majority of people don't like crime, so people would just take matters into their own hands. If a criminal was on the loose, they'd be captured or killed by a mob of people acting as their own police force.

quote: This is why we vote and have discourse in this country, to determine how far we all are to let the government go in determining how we as a people should handle anything in our lives.

The point you were making before ran contrary to what you just said here. Before you said that the government should force certain rules on people and protect people from their own freedom of choice. The people said that they want SUVs, you said that the government should make laws mandating smaller vehicles, ignoring what the people wanted and limiting their freedom of choice.

What happens when you don't like your freedom of choice being limited and you decide to vote these politicians out? Maybe that's another choice that the government should limit? Surely we can't have the people thinking for themselves, can we?

quote: Only on DailyTech would that kind of Collectivist nanny state bullshit get a 5. Shortsighted? I think we've seen just where your point of view has taken us. We're drowning in it as we speak.

This is what happens when you have emotional thinkers trying to run the show. They know what they want but don't know how to form a workable plan. So they try to enforce their emotional, unworkable plan with heavy-handed laws which, not surprisingly, doesn't work.

quote: Allowing automakers to sell high fuel consumption, less efficient vehicles only benefit the automakers and oil companies, and that benefit exists so long as gas exists, is readily available, and stays cheap.

Most of your argument is really tenuous. Business starts with customer demand. If customers want SUVs, then how are you helping the customers by denying what they want? Why don't you let the market take care of this? Companies can offer a selection to the customer, and then the customer can decide what he wants to buy?

quote: Securing and stabilizing the country's energy needs is and should be a job of the government to ensure that the market doesn't destroy itself. Sure, you may want that large vehicle, but if you want to keep driving it long term and make it affordable (affordability is something that everyone, including businesses want), conservation of petroleum to keep the price low is the only way to make it happen.

Oil is a commodity that's traded in a global market. If the US uses less oil, that oil doesn't get stored for our future use. Instead, it just drives the market price down and then the consumers in other countries will demand larger, less efficient vehicles since gas will be cheap. In the end, you didn't conserve anything. Even if we found a huge amount of oil right here in the US, that doesn't mean that it helps our energy independence. As I mentioned before, it's a global commodity and that fuel would be worth a lot of money. So if we somehow found a huge reserve of oil in Kansas, that oil would simply be sold for the normal market rate. If there was a huge global oil shortage, that oil from Kansas would still be sold on the open market, the price would just be higher.

No safety demands, no rules about the strength of lets say headlights, seat belts, noise, pollution....

If anything the Government is helping the US automakers to enter the 21st century. I know they are kicking and screaming right now but unless car makers try to keep up with the rest of the world then they'll end up selling only niche cars.

Look at the market shares of foreign cars in the US and then look at the market share of US cars abroad. Here in Europe is more normal to see a Lamborghini than a F150!

Yeah it has absolutely nothing to do with the fact that people like to buy large SUVs when they can afford them. Even today they're still selling. Perhaps not as well as before but still well. Some are just starting to choose slightly smaller crossovers like the Chevy Equinox which gets 32 mpg. The trade off is that its useless for doing any real work or towing.

You realize you don't know what they do for work right? Maybe they need a truck for work, like towing, or moving heavy items or things like that? You are too quick to think that everyone who owns a truck has one just because and not cause they need one for what they do for a living.

"My first new vehicle is a truck, and my next vehicle will also be a truck. When I can't buy a Ram, Tundra, F150, or Seirra anymore in this country I'm moving to Canada or Australia."

Can't talk to Canada, but you'd be hard pressed to find any of the vehicles mentioned down here in Aus... I do know a person with an F350, cost him quite a bit more that 100K to get it here, certified, modified, etc., and it costs him well over $250 / week in fuel costs... $1.27 to $1.65 per litre, depending on grade...

quote: Yeah it has absolutely nothing to do with the fact that people like to buy large SUVs when they can afford them.

See this is what I find so misleading. Large SUV sales have NEVER even broken into the top 20 in the US. I think the Yukon hit number 22 once or twice. Large SUV's are a niche market like sports cars yet some people seem to think they're everywhere and everyone in the US is driving one. Let's move past this BS. What IS selling by the buttloads is pickups (mostly 1/2 tons). Well over 100,000 pickups are sold every month! Granted, a lot of those go to fleets but if "you people" are going to crap on Americans loving gas guzzlers, at least be accurate about it.

The following is auto sales in the US. There is a bit of shake up because there are TONS more US cars in the top 10 than in the past 20 years but that's probably due to supply issues in Japan.

Japan has had an extremely large edge when they came here with their small cars decades ago. They did not have to pay for retirees for they were none, while the domestics had to pay for over a million retirees.Today they are complaining for something which should have little effect on them. Afraid the domestic will more money than them. I would tell them, all they to do is build trucks like the domestic does, but they know Americans will buy mostly American trucks.

The logic then was that a "truck" was likely to be a work vehicle rather than a family or recreational vehicle. The auto companies reacted to this loophole and ***customer demand*** by creating fancified trucks and pseudo-trucks (SUVs).

Since these maneuver like, well, trucks, "safety" since then has largely been a race to add more height, mass, and exploding air bags since the sheer mass of these vehicles is excessive.

This of course means poorer MPG, which is why we're still having this debate instead of laughing at OPEC.